Is Jersey scaring Philly? Not yet: Camden area still has ways to go, experts say

By Andrew George,
July 21, 2014 at 12:00 PM

A view of Philadelphia from the Camden waterfront, where new projects are in the works. - (PHOTO BY AARON HOUSTON)

It was subtle and yet, at the same time, completely in your face.

In the backdrop of the Philadelphia skyline and its prized Navy Yard, Gov. Chris Christie and state lawmakers gathered last week at the site of a future marine terminal in Paulsboro, touting the economic benefits of establishing a new working port.

Not even an hour later, Christie and others were just up the road in Camden to announce the commitment by Holtec International, a major energy industry manufacturer, after the state awarded the firm a massive 10-year, $260 million tax credit just days earlier.

It was a busy day for state Sen. Donald Norcross (D-Audubon), who for months has alluded to big projects coming to the area, one after the other. That parade seems to be underway in earnest — especially as South Jersey's new aggressive incentive offerings are put to work.

So is it finally time for Philadelphia to start worrying about its neighbor to the east?

“They always do when New Jersey is across the river,” Norcross laughed.

But as some experts in the Keystone State point out, Camden and South Jersey still have a long way to go before they're ready to really give Philly a run for its money.

“Philadelphia, at this point, has a lot more to offer but also a lot more to worry about than Camden,” said Villanova University economics professor David Fiorenza.

He said Philadelphia has been successful in offering its own incentives — such as tax credits for business that are certified as “sustainable” and job creation tax credits that can reach up to $5,000 per new job. That's in addition to incentives offered by state officials in Harrisburg.

And the city still has the edge over Camden when it comes to housing and providing an atmosphere in which people live where they work, Fiorenza said.

“As Camden gets more developed, they're going to have to start looking at more than just bringing business to town,” he said. “They're going to have to start looking at housing.”

Prior to last year's incentives overhaul under the Economic Opportunity Act, South Jersey struggled to compete against the Navy Yard, a former working naval shipyard on the banks of the Delaware River that has been transformed into a thriving, 1,200-acre business campus boasting some 145 companies.

The site, developed and managed by the Philadelphia Industrial Development Corp., offers its own set of attractive incentives, from 10-year real estate tax abatements to loan programs to specific tax credits for technology startups.

And the site is coming off a banner year. PIDC officials said in January that, in 2013, 22 new companies were added to the Navy Yard — more than in any other year since its transition to a business campus began.

“The Navy Yard is still growing and it's still becoming a force,” Fiorenza said.

But New Jersey has notched at least one recent victory against the property. Last month, the Philadelphia 76ers accepted a 10-year, $82 million tax credit from the EDA to build a new practice facility and team headquarters in Camden — after eyeing a site in the Navy Yard.

Marc Policarpo, a senior vice president with Philadelphia-based Binswanger, says he has indeed seen what he characterizes as a “seismic shift” in the way people now think about Camden, adding that the Economic Opportunity Act helped to “really put New Jersey over the top.”

Still, he said, let's not get ahead of ourselves.

Policarpo, who does work on both sides of the Delaware River, notes that the “Navy Yard is still a very attractive option” and that “at the end of the day, real estate costs and incentives all take second place to labor issues.”

If nothing else, officials west of the river are taking notice. Steven Kratz, a spokesman for the Pennsylvania Department of Community and Economic Development, said Pennsylvania isn't blind to what's going on in the Garden State.

“We're definitely aware of what New Jersey is doing and certainly aware of the competition that's out there,” Kratz said.

But that doesn't mean his state is about to rework its economic development framework. Kratz said the reality remains that Pennsylvania is a “much more attractive state when it comes to taxes and doing business.”

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Andrew George

Andrew George covers the Statehouse from NJBIZ's Trenton bureau. Born and raised in N.J., Andrew has also spent time as a reporter in D.C., Texas and Pa. His email is andrewg@njbiz.com and he is @AndrGeorge on Twitter.

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